Plunging U.S. revenue at X risks opening up a "massive hole" on its balance sheet that Musk needs to plug to stave off its financial collapse.

Musk’s repeated outbursts against advertisers have dried up the main source of revenue for the loss-making company formerly known as Twitter. A recent decision to sue them for heeding his own advice to not buy ads on the platform hasn’t helped. At some point, he will have to provide a fresh infusion of cash to salvage his $44 billion takeover.

  • Valmond@lemmy.world
    5214·
    3 months ago

    Why is this news…

    Some rich guy might do something that doesn’t really change anything for anyone.

    • Voroxpete
      432·
      3 months ago

      Because it will affect Tesla’s share price (negatively), just like it did last time, and Fortune’s job is to report on things that affect share prices.

      There is also a public interest element, because Musk is currently the richest man on earth - which affords him massively undue power and influence - but he won’t be if he manages to crash the Tesla stock price with a massive sell-off.

      Tesla is exceedingly overvalued right now which makes it a very volatile stock. We already saw the price crater the last time he sold stock to keep Twitter afloat, and it only really recovered when he pinkie swore not to do it again.

        • Voroxpete
          4·
          3 months ago

          Oh, I’m not implying that it was ever valued correctly. I’m saying that it’s gone from “overvalued” to “exceedingly overvalued”.

      • IphtashuFitz@lemmy.worldEnglish
        13·
        3 months ago

        Not to mention that if he sells enough Tesla shares he could lose majority control of it. If that happens and enough shareholders band together they could force all the Elon sycophants off of the board of directors, then the new board could force him out as CEO.

        • jonne@infosec.pub
          15·
          3 months ago

          A lot of shareholders have drunk the Elon kool-aid tho, look at the recent shareholder vote about Elon’s ridiculous pay package.

          There’s a lot of true believers that treat it like a meme stock and don’t look at the fundamentals.

          It’s going to go down eventually, but it might take longer than you’d expect based on the numbers.

          • Voroxpete
            3·
            3 months ago

            100%. Tesla shareholders are an almost entirely irrational market. Turns out buying into a stock that over-priced does not self-select for a healthy ability to assess risks.

      • AA5B@lemmy.world
        310·
        3 months ago

        I understand the aversion to Musk coming out as a horrible human being, but Tesla is still pivotal to the EV industry. Or maybe we get a twisted view of reality in the US, but most EVs sold are still Teslas and teslas are arguably the cheapest, most compelling EVs available for sale.

        • Legacy manufacturers have always resisted the newer technology, and when they finally invested the money, took the first opportunity to step back away from them.
        • Rivian and Lucid have exciting technology and styling, and the opportunity to take the lead with compelling EV but are still too young. Neither have yet released a car that they can sell in volume. Remember all the stories of Tesla almost going bankrupt trying to scale up the model 3? They still need to get past that.
        • GM seemed to have a lot of promise but took a few years off from EVs, and really flubbed the new releases, so are returning their focus to ICE vehicles
        • Ford had a great strategy but too much dealer resistance and profiteering. No one is buying a car that starts off much more expensive than comparable models, has huge dealer markup, and salesmen steering yu away. They’re a good argument for Tesla’s approach of selling direct
        • does vw sell any EVs in the US? Technically I guess there are Porsche and Audi EVs, for the well off.
        • Toyota and Subaru compliance models aren’t even a blip

        Is Hyundai/Kia our only hope if Tesla has problems? They’re coming in strong with relatively inexpensive and compelling models, but somehow always fly under the radar. For anyone understanding the importance of the technology shift from ICE to EV, we need Tesla

        • Voroxpete
          1·
          3 months ago

          I think this is a culture difference. In Canada Hyundai and Kia are everywhere (at least around the GTA). Probably a third of the cars I regularly see on the street. Definitely not flying under the radar.

    • 5714@lemmy.dbzer0.com
      2·
      3 months ago

      Profits stolen by Musk, that do not get reinvested into Tesla, are wasted for unnecessary and or harmful labour time and infrastructure (political advertising etc). Tesla workers produced those profits and now the products of their life-time gets wasted by decision makers like Musk Tesla workers have little power over.

    • boonhet@lemm.ee
      2·
      3 months ago

      Potential Tesla stock price crash aside - if he sells enough stock, the company will be less associated with him and people on the left (you know, people who actually WANT EVs and not coal rollin’ pickup trucks) would be more likely to buy Teslas again. Because to be fair, they do make some damn awesome powertrains (and attach an aerodynamic smart fridge to it unfortunately, but eh, you can’t have everything all at once, now can you)

    • AA5B@lemmy.world
      13·
      3 months ago

      Twitter used to be very widely used.

      Tesla, at least in the US is by far the biggest EV manufacturer

      They’re both a pretty big deal and he’s well on his way to wrecking one: we hope it’s not both